Factors That Affect Underwriting

All insurance companies set underwriting and rating guidelines. They use these guidelines to determine whether to offer you coverage and how much to charge you. The factors that affect underwriting may include, but are not limited to:

Property Information This includes your street address, the year your house was built, number of living units, type of construction material, type of foundation, living space square footage, number of rooms, age of the roof, roofing materials, and the age of heating, plumbing, and electrical systems.

Community Fire ProtectionThese factors include the distance from your home to the nearest fire department and fire hydrant, and the fire department’s response time.

Prior Insurance Insurance companies look at your prior insurance history. For example, if you own an uninsured property for several years, and then decide to insure it, you will have a more difficult time getting insurance. Insurance companies believe this shows a lack of responsibility by the homeowner.

Claims & Occurrence History Your insurance company may ask you to disclose both claims and occurrences from the past. A claim is a loss you reported to the company for coverage. An occurrence is either a loss you did not report, or if you did report it, it did not result in an opened or processed claim. Insurance companies believe this represents the potential for loss, and may ask you about such events.

Stability Your insurance company will ask you for information, such as your occupation and how long you have worked for your current employer.

Credit Information Your insurance company may ask you to provide information about any bankruptcy, judgments, or credit problems. They may also obtain your credit history from one of the national credit reporting companies.

Your insurance company may also require an inspection of the property. Once the policy is issued, they may require a re-inspection prior to a renewal.